Goldman Sachs (GS) is set to release FQ4’2013 earnings before the market opens on Thursday, January 16th and hedge funds are not expecting things to go well. This quarter several hedge fund analysts on the Estimize.com platform are expecting Goldman to miss the Wall Street profit consensus by a wide margin. Here is what what the hedge fund analysts are saying compared to everybody else.
The 4 hedge fund analysts who have submitted estimates to Estimize.com for Goldman Sachs this quarter have a mean EPS forecast of $US3.28 EPS while Wall Street expecting $US4.15. The aggregate estimate from buy-side and independent contributing analysts on the Estimize.com platform is $US4.01 EPS. The hedge funds’ mean revenue forecast is also lower than either the Wall Street consensus or the Estimize consensus. The hedge fund analysts expect an average of $US7.638B while Wall Street expects $US7.751B revenue and Estimize.com is forecasting $US7.840.
Over the past 2 years Goldman has beaten the Wall Street consensus by wide margins in each quarter. The Estimize consensus has been more bullish than the Wall Street consensus every time over the past two years and therefore has been more accurate. This quarter we are seeing an interesting reversal, the Estimize profit consensus for Goldman is lower than Wall Street for the first time ever.
Estimate confidence ratings are calculated through algorithms developed by deep quantitative research which looks at correlations between analyst track records and tendencies as they relate to future accuracy. In the case of Goldman Sachs this quarter, the top rated estimate is taking an opposing view to the hedge funds.
The confidence algorithm on Estimize.com has rated user BradHewitt91’s estimate as the top rated. BradHewitt91 also happens to be the #1 rated analyst in the 2014 winter earnings season so far and is ranked 14th overall among over 3400 contributing analysts on the platform. BradHewitt91 and the majority of contributing analysts are actually expecting Goldman to beat the Street on profit has represented by grey dots in the scatterplot above. The top rated analyst for Goldman this quarter is expecting $US4.20 EPS and $US7.925B in revenue.
Over the past 4 months the revenue consensus from both Estimize.com and Wall Street have both fallen. At the end of the quarter we saw Wall Street revise its profit consensus upward while the Estimize consensus was dropping, but recently the Estimize revisions have changed direction to a small extend.
Throughout the past two years Goldman Sachs has been an unstoppable force in terms of beating the Wall Street consensus. For the first time ever this quarter the buy-side and independent analysts on Estimize.com are expecting Goldman to miss the Street, and all of the hedge-fund contributors are expecting them to miss big.
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